I am delighted to present a guest post by Adesh Sidhu. Adesh runs his excellent blog Not being Sarkari. He is a "Customer Advocate, Apple fan, Desi and an avid reader". He writes passionately on customer service - his blog carries many excellent posts. Thanks Adesh for your post that follows
Big boys make rules. Big boys want to rule the world by the rules they have created. They have created rules, which are convenient to them, and these rules serve as entry barriers to new players.
For so long music industry worked on royalty and record labels were operating by the rules, which they have created. From music creation to marketing of music to enforcement of copyright, record labels handle everything. Singers and musicians were depended on record labels for their success. Record labels were the big boys and rules they created were suited to them. Customers had to pay whatever price record labels decided. If record has only one good song, customers also had to pay for 7 below par tracks.
Then came the digital downloads. Napster changed the rules of the game. They were small but agile. They did not have resources but they had ideas. They challenged the age-old business model of record labels. Customers lapped this idea of free downloads. Customers had the power to choose good songs over poor songs. Napster was David. They almost changed music industry.
But Goliath did not like it. They objected this, as they were clueless on how to play the game with rules changed. They got Napster banned. Napster started the revolution by giving music digitally and later on iTunes capitalized on this revolution. iTunes model was little different as they were charging from customers for music download and taken steps to reduce piracy. This time record labels decided to partner with iTunes. Record labels knew that if they have to stay in the game, they have to adopt new ways and means of doing music business.
Singers and musicians were dependant on record labels to launch them and promote their music. With the advent of social media, not-so-known but innovative singers and musicians started building communities of their fan clubs. They started releasing their music on Internet and their fans can download the music directly from sites. Record labels are eliminated and singers/musicians are communicating directly with their fans. David won again.
Lot of many times we decide not to compete because we do not have resources. We rarely think of competing with bigger players by changing the rules.
PS: - This article inspired this post.
In case link does not work, use the link in parenthesis. (http://www.newyorker.com/reporting/2009/05/11/090511fa_fact_gladwell?currentPage=all)
For so long music industry worked on royalty and record labels were operating by the rules, which they have created. From music creation to marketing of music to enforcement of copyright, record labels handle everything. Singers and musicians were depended on record labels for their success. Record labels were the big boys and rules they created were suited to them. Customers had to pay whatever price record labels decided. If record has only one good song, customers also had to pay for 7 below par tracks.
Then came the digital downloads. Napster changed the rules of the game. They were small but agile. They did not have resources but they had ideas. They challenged the age-old business model of record labels. Customers lapped this idea of free downloads. Customers had the power to choose good songs over poor songs. Napster was David. They almost changed music industry.
But Goliath did not like it. They objected this, as they were clueless on how to play the game with rules changed. They got Napster banned. Napster started the revolution by giving music digitally and later on iTunes capitalized on this revolution. iTunes model was little different as they were charging from customers for music download and taken steps to reduce piracy. This time record labels decided to partner with iTunes. Record labels knew that if they have to stay in the game, they have to adopt new ways and means of doing music business.
Singers and musicians were dependant on record labels to launch them and promote their music. With the advent of social media, not-so-known but innovative singers and musicians started building communities of their fan clubs. They started releasing their music on Internet and their fans can download the music directly from sites. Record labels are eliminated and singers/musicians are communicating directly with their fans. David won again.
Lot of many times we decide not to compete because we do not have resources. We rarely think of competing with bigger players by changing the rules.
PS: - This article inspired this post.
In case link does not work, use the link in parenthesis. (http://www.newyorker.com/reporting/2009/05/11/090511fa_fact_gladwell?currentPage=all)
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10 comments:
I would add further to your efforts in highlighting key to sucess ie 'being big is thinking big' its not related to physical form. That would develop later. Look at how "NIRMA" gave (and continues to give) world leaders - run for their money.
The blog as well as the article were indeed a good read. Especially inspiring for young turks like me, who keep wondering everyday 'there has to be a way to crack past the conventional rut'. - Deepa
@raj - Thanks for visiting. Having worked for a long time with a company who was kicked often by Nirma, I can completely agree with you !
@deepa -Thanks for dropping by. Adesh has indeed written a very nice post.
@ Raj - Thanks for visiting. I could not agree with you more on this.
@ Deepa - Internet is a levels playing field. In today's it easy to start a company and take on big players. Thanks for visiting.
In this world of huge competition if winning is all that matters then changing rules for that is very OK. Anyways who liked to follow ol rulez, not me and nor do any of the customers who buy music. iTunes definitely had a deal that would benefit both the ends, the seller and the buyer, so what if it had to change rules, nobody gives a damn as long as the business is up n running.
A very interesting read. The power of internet is often underestimated. And so is the power of ideas. And, I believe that when bot come together it is a formidable combination.
Great post Adesh.Ramesh - thanks for sharing it with us.
Nice post Adesh, Im a strong supporter of the underdog.What can be a bigger kick than, the David's of the world beating the Goliath's at their own game!
Its a conincidence that i read this report before i read ur post.. http://blogs.harvardbusiness.org/bregman/2009/03/why-small-companies-will-win-i.html?cm_re=homepage-031909-_-lede-_-headline
@ Rads - We do not love to follow rules but at the same time we do not have ideas to change the rules which are set by big boys of business.
@ Thanks Zoobie - You have rightly mentioned ideas and internet is very potent combination.
@ Blogueur - Thanks dear.
@ A journey called life - Thanks for sharing a wonderful link.
@Adesh: True that it takes big boys to make rules but if the rules are benefiting us-the customers then no harm in following them right? Isn't buying the songs we choose like in iTunes better than buying a whole cassette for one song? If rules like that are made I'll follow and so will many music buyers I guess.
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